Network Home Dir:You cannot log into this computer

I'm trying to setup an Xserve to replace what is on an old G4. I opted to start from scratch than to CCC the drive. The G4 has one hard drive and everything is on there. The Xserve has 3 hard drives system - for the OS myusers - which is where I would like to store the networked home directories filestore - this will store files for the company I have myusers set to automount, I have AFP guest access on. I have guest access on in AFP in Server Settings. I've setup Directory Access on the clients just like I have on the G4 that has been working perfectly for over a year. I've format and started from scratch now 3 times and I'm having the same problem trying to setup network home dirs. If I login as an admin or regular user on any mac I get this error at the login window. I am able to change passwords if I set the user to change at next login. Also the home dir structure gets created where it should ------------------------------------------------------------- You cannot log into this computer. You are not able to log into this computer. Contact your system administrator for help. ------------------------------------------------------------- So after I contacted myself I didn't have an answer. I've gotten this in the past but only when I setup Computer Lists to allow only certain users on a particular Mac. I have no computer lists and I still get this error whether I have Guest Computers set to inherit or define. If I make a computer list and I've tried with 3 different Macs I still get the same error. What the h3ll am I doing wrong? _______________________________________